OPEC should cut oil output: Iran

October 25, 2008

Iran’s oil minister on Thursday said that a drop in demand meant OPEC should decide to cut production by two million barrels per day when it meets for a meeting in Vienna on Friday.

“Two million will stabilise” the market, Gholam Hossein Nozari told reporters on arrival in the Austrian capital. On Tuesday he had said that Iran was looking for a cut of between two and 2.5 million barrels per day.

“The rate of reduction of demand is good for a cut,” said Nozari.

OPEC’s member countries are calling for a cut to the cartel’s output to help shore up oil prices, which have tumbled in recent weeks as a global economic slowdown slashes demand.

Analysts expect the cartel to decide on a reduction of at least one million barrels per day when it meets for an extraordinary meeting tomorrow.

OPEC produces 40 per cent of the world’s oil and its official output quota stands at 28.8 million barrels per day.

Iran is the second largest exporter in the Organisation of Petroleum Exporting Countries and its economy is heavily dependent on oil and gas income.